Key player in lithium hydroxide production European Lithium Ltd is making strides in its joint venture with Saudi Arabia’s Obeikan Group to develop a new hydroxide processing plant.
The partnership has increased the planned capacity of the hydroxide processing plant from 10,000 to 20,000 tonnes per annum, showcasing a commitment to scaling operations and meeting growing market demands.
The capital investment represented by the processing plant will be fully funded through the joint venture and the parties are pleased with progress.
This new facility, once operational, is expected to significantly reduce energy costs and deliver savings in opex, in addition to lower capex, for operations at the company’s Wolfsberg Lithium Project in Austria.
European Lithium and Obeikan are on track to finalise the incorporation of the joint venture company and the shareholder agreement within the first quarter of 2024.
The joint venture is structured on a 50:50 basis, focusing on developing, constructing and commissioning the lithium hydroxide processing plant.
This partnership aims to convert lithium spodumene concentrate from Wolfsberg into high-quality lithium hydroxide.
The agreement stipulates an exclusive right to purchase spodumene mined from Wolfsberg’s current resource, enhancing the long-term viability and stability of the project.
Leveraging industrial strength
The agreement with European Lithium aligns with Obeikan’s strategic goals and leverages Saudi Arabia’s industrial strength.
This venture not only promises operational efficiencies but also strengthens the economic prospects of European Lithium’s future projects, positioning the company as a formidable player in the global lithium market.
Additionally, the company anticipates commencing Zone 2 drilling at Wolfsberg in the second quarter of this year, capitalising on strong forward momentum in its resource development activities.
European Lithium has previously confirmed the potential of Zone 2 to mirror the resources declared in Zone 1.
“We are pleased to be in the final stages of reaching this strategic step in partnering with Obeikan that paves the way for significant opex savings including greatly reduced energy and financing costs,” said EUR chair Tony Sage.
“We look forward to progressing our plans to harness the latest technology in developing a facility of the highest quality and efficiency, and in doing so, strengthen the economics of Wolfsberg and our future projects.”
Obeikan Investment Group CEO Abdallah Obeikan said: “We are pleased to have reached this agreement with European Lithium.
“We are convinced that our partnership will be beneficial for all stakeholders. This partnership will combine EUR expertise with the industrial knowledge of Obeikan and the strength of Saudi Arabia.”